Most contractors don't take the time to apply overhead costs to a job in Quickbooks. It takes a few extra steps. However, if you want to invest 30min to 90min a month to see overhead recovery in Quickbooks, there is a way. Keep reading!
Step One: Use LMN to find Overhead Recovered
There are two ways you can see how much overhead LMN is recovering on a job.
Finding Overhead for One Job At a Time: If you're just entering overhead for one job, you can open the estimate in LMN Estimating. Go to the Analysis tab and look for overhead recovered.
Finding Overhead for All Sold Jobs In a Period: Its a lot faster to enter overhead for a bunch of jobs at once. Luckily, there's a report in LMN that will show you your overhead recovered for a bunch of jobs at once, instead of opening each job one at a time.
- Go to the Estimate menu, then click Standard so you're looking at your list of standard estimates
- Click the Excel button (it's the white button at the top of the list right beside the Update Estimates button)
- This will download all your estimate summary info to an Excel spreadsheet. Open the spreadsheet.
- Click the Enable Editing button at the top of the spreadsheet (the yellow notice)
- You don't want to recover overhead for jobs you didn't sell or complete, so you need to filter your spreadsheet to show only jobs you've sold or completed. (some companies enter the overhead cost as soon as the job is sold, other companies wait until the job is completed to enter overhead)
- In your Excel spreadsheet, click the Data menu, then click the Filter button
- Now all your columns will have a filter drop-down option at top of them. Go to the Status column and click the down arrow.
- Select the Statuses you wish to include in your overhead recovery calculations. This could be all SOLD jobs or maybe you only want to include jobs that are COMPLETE. Pick whatever works for you. Note, the screenshot below shows sample statuses. Your statuses may differ.
- Next, you probably want to only include estimates for a specific date range, so next click the filter dropdown on the Date column and pick specific years/months/etc
- Now you should be looking at only sold/completed jobs in a specific date range. There's all the jobs that you need to apply overhead for.
- Still looking at your spreadsheet, scroll to the right to Column V - Total Overhead. That's the overhead each job needs to recover, as per the estimate.
Before moving on, repeat that same process for SERVICE estimates.
Step Two: Apply Overhead to Jobs in Quickbooks
Quickbooks gives you two different ways of manually applying overhead to jobs so that your jobcosting reports show overhead recovery costs. There are two links below to explain how to do it.
Follow the instructions in either of the methods above, then run a jobcosting report in Quickbooks (Reports | Jobs, Time & Mileage | Job Profitability Detail)
You will see your overhead costs now be deducted from your job's profitability. In our example screenshot below, we used the simple method which means my overhead recovery shows up on the report as a line called No Item. Note below how it deducts the overhead I've recovered from our job profit.